Downing FOUR VCT

AIM share class

Downing FOUR AIM share class provides tax benefits by investing in a high conviction portfolio, initially targeting holdings of between 15 and 20 companies, mostly listed on the Alternative Investment Market (AIM), and which have a focus on capital growth.

Your capital is at risk and you may not get back the full amount you invested. VCT investments are long term and high risk. Tax reliefs are subject to change and depend on personal circumstances. Past performance is not a reliable indicator of future performance. Please read full details of the risks here.

Key features

  • Special offer: 1% reduction in initial fee for new investors or 1.5% reduction for existing Downing investors, if application is received by 29 October 2021.
  • A selective new portfolio: An intensely researched portfolio of existing AIM companies, AIM IPOs and a minority of companies that are close to listing on AIM. As this is a new share class, there won’t be a drag on performance from any existing underperforming investments. 
  • Diversification: Your money will be invested in a series of new opportunities in various sectors such as healthcare, business services and e-commerce. This potentially spreads your risk compared to VCTs that focus on a specific sector. Other VCTs often have holdings in early stage companies, however Downing FOUR invests in AIM companies that are generally further along in the business life cycle which can help reduce the risk to your capital. 
  • Target raise: £10 million (with capacity for an additional £15 million). This figure allows us to deploy your capital more efficiently and avoid holding too much cash, which can act as a drag on returns. 
  • Minimum investment: A minimum lump sum investment of £5,000 (which can be split over two tax years and three share classes, subject to a minimum of £1,000 in any one option). The maximum you can invest per tax year is £200,000.
  • Generous share buy-back policy: Downing FOUR intends to buy-back its shares at a nil discount to their net asset value, giving you the opportunity to sell your shares with no exit penalties. (Subject to liquidity and applicable VCT regulations).

What do I need to know before investing?

  • How is my money invested?

    Your investment in the Downing FOUR VCT AIM share class is looked after by Downing Fund Managers (DFM), led by Judith MacKenzie, who currently manage £370 million of investors’ assets (as of 30 June 2021). 

    Our fund managers have extensive experience in making AIM investments, and their robust research and due diligence process means that only companies meeting strict qualifying criteria are considered.  

    DFM take a ‘private equity’ approach to picking suitable investments, looking beyond a company’s numbers and current standing to focus on the long-term potential that could be realised with the right funding and support.  

    In line with the nature of the AIM market, DFM are a generalist investor. But unlike other AIM investment managers they have direct access to specific sector expertise through the wider Downing investment team, which can be invaluable throughout the stock selection process.  

    Combining ‘deep-dive’ research and due diligence with the breadth of Downing’s investment knowledge is intended to give you an initial handpicked portfolio of 15 to 20 companies in different sectors. The portfolio will be actively managed to keep it fresh and focused on aiming to provide you with growth on your investment. As it matures and if further funds are subsequently raised into the share class, we may seek to add more companies to your portfolio. 

  • What are the risks?

    As with all investments, Downing FOUR VCT has risks that you should be aware of and comfortable with before you invest.  

    • The value of your VCT shares can go up and down, so your capital is at risk. Any income received from your VCT shares can rise and fall. 
    • Shares in AIM companies are considered to be higher risk and more volatile than larger listed securities. 
    • VCT tax benefits are not guaranteed, are subject to change and apply only if you hold your shares for a minimum of five years. 
    • Maintaining VCT status is not guaranteed, which may result in you having to repay the amount you received in tax relief.  
    • It can be hard to sell your VCT shares compared to other stock market investments, so you should be prepared to hold them for the long term. 
    • The past performance of a VCT is not a reliable indicator of future results. 

    Please note, this is only a brief overview of the risks involved with investing in a VCT. Please read full details of all the risks in the Prospectus and Brochure before investing. 

  • What are the charges?

    Special offer: 1% reduction in initial fee for new investors or 1.5% reduction for existing Downing investors, if application is received by 29 October 2021. 

    Below is a summary of the fees that will apply to your investment in Downing FOUR VCT. For full details of all fees associated with this product, please refer to the brochure.  

    Initial fee2.5% of the sum invested (via an adviser) or 4.5% (direct or via an intermediary) 
    Annual management fee 1.75% p.a. of net assets. The total annual running cost is capped at 3% p.a. (this includes fees for audit and taxation advice etc.) 
    Performance incentive
    fee
    NIL 
  • What happens once I've invested?

    Once you have invested in Downing FOUR VCT we'll send you and your adviser an email confirming receipt of the application, so you can then arrange to transfer the funds for your investment. We will send you another email confirming that your money has been received. We intend to make share allotments, i.e. create and issue shares, at least once per quarter.

    Shortly after your shares have been allotted, we’ll send you and your adviser an email, which will contain a PDF version of your tax certificate that you can use to claim income tax relief. You can expect to receive a share certificate in the post within 10 working days of an allotment. You'll need your tax certificate to claim income tax relief on your investment amount.

    In July of each year, we'll send you the annual report and accounts to 31 March. Each January, we’ll also send you a half-yearly report for the six months to 30 September of the previous year.

Essential reading

It's really important that you read these key documents, paying particular attention to the risks, before you decide to invest. We recommend you seek financial advice.
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Brochure
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Key Information Document
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Prospectus and Supplementaries

How to invest

The first step is to read and understand the brochure, key information document and the Prospectus and Summary. If you are applying through a financial adviser please discuss this investment with them. When you’re ready to invest you or your adviser should fill in the online application form below.

We're here to help

If you are a financial adviser, or discretionary fund manager please call us on 020 7630 3319 or email us at sales@downing.co.uk.

If you are a private investor you can speak to Downing LLP's investor relationship team on 020 3828 0975 or email customer@downing.co.uk.